The Australian government has taken a major step to fill regulatory gaps in the cryptocurrency market and protect customer assets. Treasurer Jim Chalmers and Minister for Financial Services Daniel Mulino have introduced the Corporations Amendment (Digital Assets Framework) Bill 2025 to Parliament.
- Act’s Objective: The bill aims to establish Australia’s first comprehensive regulatory framework for businesses that hold digital assets on behalf of customers. It allows for multi-million dollar penalties for firms that fail to protect customer assets.
- Economic Goal: Government officials also believe the Act has the potential to unlock productivity gains of up to $24 billion annually.
New Legislative Framework and Mandatory AFSL
The bill overhauls the regulatory structure by adding two new financial product categories under the Corporations Act. All entities operating under these structures must obtain an Australian Financial Services Licence (AFSL).
- Digital Asset Platforms: These include facilities that provide transactional activities such as holding customer crypto assets, trading, selling, exchanging, or staking.
- Tokenized Custody Platforms: These hold real-world assets (RWA), such as securities, property, and commodities, that have been tokenized. Licensed operators must securely hold each underlying asset and issue a single token.
Once the Act comes into force, exchanges and custody providers will henceforth be subjected to traditional financial services laws.
The Role of ASIC and Compliance Standards
The Australian Securities and Investments Commission (ASIC) will be primarily responsible for this regulatory framework.
- Conduct Rules: All AFSL-licensed platforms must operate “efficiently, honestly, and fairly.” They must also adhere to ASIC’s stringent custody and settlement standards for functions like handling client instructions, executing trades, and securing assets.
- Precautionary Measure: The fundamental goal of the bill is to prevent customer assets from being rendered unsafe, as has happened in global crypto firm collapses.
Smart Balance: Exemptions and Innovation Opportunity
The most crucial and pragmatic aspect of the legislation is granting an exemption from full licensing for platforms with lower-risk operations.
- Exemption for Smaller Platforms: Lower-risk platforms that hold less than $5,000 in assets per customer and trade less than $10 million annually are exempted from full AFSL licensing requirements.
- Support for Innovation: Experts in the Web3 education sector praise this exemption for “truly small and low-risk platforms,” stating it allows for early-stage experimentation and innovation without every prototype requiring immediate full licensing. This is seen as a smart government approach that balances innovation with consumer protection.
Criticisms and Future Gaps
While the direction of the bill is correct, several key concerns are raised by the industry:
- Regulatory Lag: Critics like Associate Professor Darcy Allen of RMIT University argue that due to the years of delay, Australia is now a “follower,” trailing other markets that have moved ahead with legislation like Europe’s MiCA.
- Definition and Tax Issues: Industry experts state that the “definition details” within the legislation are insufficient and that there is a lack of clarity regarding the cost of the regulatory burden. Furthermore, as the bill does not directly provide tax clarity, Australian operators may struggle to navigate compliance costs and tax-related confusion. They urge continued advocacy for comprehensive reform.
The Journey Towards Regulatory Clarity
By bringing crypto platforms under financial services laws, Australia has taken a significant step toward establishing stability and consumer confidence in the digital asset ecosystem. Its clear focus on RWA tokenization indicates Australia’s eagerness to leverage blockchain technology to enhance economic productivity. Although the journey still faces challenges, this is a crucial piece of legislation that will set a clear, yet strict, regulatory environment for crypto businesses.
